When you’re a small business owner, figuring out your business finances can often seem like a daunting task. How much revenue did you earn this year? How much did you spend? Did you make a profit? What can you do to ensure that your business continues to earn more than it spends? These are just a handful of the questions you will have to ask yourself when figuring out finances and making major financial decisions.
Many small business owners try to take their financial matters in their own hands, hoping to save more money. However, this is not always the best option for small business owners. Unless you are a skilled accountant and are able to fully understand your finances and how major financial decisions may impact your business, it may be more beneficial to employ the help of a certified accountant.
What Kind Of Accountant Does Your Small Business Need?
Accountants can help with an array of financial decisions from end of year tax returns, to everyday business planning. They can often spot possible problems and issues and offer solutions you may have missed. Spotting these problems ahead of time will help to save your business from losing money. In the long run, the money you spend on an accountant will be less than the money you lose from trying to make financial decisions on your own.
When choosing an accountant small business owners need to consider their needs and the size of their business. For businesses that are just starting out and that don’t have many transactions or earned revenue yet, an outside accountant may be the best option. These accountants offer help with tax returns, financial statements such as income statements, balance sheets, and statements of cash, and basic analytical and problem solving tips. The cost of an outside accountant can vary depending on functions performed, but many of them charge by the hour. They are ideal for businesses that only need the help of an accountant from time to time.
If your small business is growing at a steady rate and you find yourself struggling to handle tracking down all of your receipts from various transactions and other finances, it may be time to employ the help of an inside or in-house accountant. Inside accountants, while similar to outside ones, tend to offer more help for larger businesses requiring more functions. Some of the tasks that in-house accountants can help with are daily transactions, financial statements and analysis, cost accounting and variance analysis, accountant maintenance, payroll, and more. The cost of an inside accountant may depend on the size of your business. It is recommended that business owners offer performance-based salary.
Regardless of whether you choose an inside or outside accountant you should make sure that your account possesses the proper skills and credentials to help your business succeed. Your account should be at least CPA certified. Businesses in need of more accounting services may opt to spend a little bit more money on a CMA (Certified Management Accountant). These accountants have typically received more intense training and are members of a management team for a specific company.
Some CPA’s and CMA’s may also be members of global or national accounting federations or organizations. Accountants that are a member of one of these organizations will be highly trained and qualified to assess your business financial needs.
Hiring a skilled accountant is one of the most important investments that small business owners can make. Regardless of which type or level of accounting business owners seek, they will be provided with many benefits including a better organization and understanding of their company’s overall finances and financial procedures. When business owners gain a better understanding of how they gain and spend money, they will be able to make more informed business decisions that will further help their business succeed.